Wednesday, January 25, 2012

Clippings: January 25, 2012

In The Denver Post
Mortgage loan payoffs hit 10-year low
January 25, 2012
"Real estate activity perked up a bit during the fourth quarter, which would reflect some very recent growth in employment and some mild increases in home prices." said Ryan McMaken, spokesman for the Colorado Division of Housing. "But overall, the fourth quarter's activity wasn't enough to keep 2011 from being another flat year."

The Colorado Springs Gazette
January 25, 2012
Mortgage loan payoffs fall in Springs area
But if there’s a sign of good news, it’s that mortgage payoffs in El Paso County totaled 8,023 in the fourth quarter of 2011 — an increase over each of the first three quarters of last year and a possible indication that housing activity is picking up, said Housing Division spokesman Ryan McMaken. The other 20 counties in the report also saw increases in the fourth quarter when compared with the third quarter.

“After two years of declines in mortgage rates without any big increases in activity, the fact that we did start to see some activity in the fourth quarter is a hopeful sign,” McMaken said.

Still, he cautioned, it will take several quarters to know if a trend is under way. The fourth-quarter numbers might suggest that more people have been able to afford a down payment or have accumulated enough equity in their homes that they can refinance, McMaken said.

“It’s just been very difficult for people to either purchase, to sell or to refinance, and that has just basically really pushed down the amount of release activity,” he said. “So if it’s pushing back up, it just might suggest that those trends are reversing themselves a little bit.”

Colorado Springs Business Journal
January 25, 2012
Statewide mortgage payoffs lowest since 2000
“The surprise really is that in spite of three years of declining interest rates, there hasn’t been activity,” McMaken said.

He said one explanation could be that most of the people who are eligible and qualified for refinancing probably did it in 2009 when rates first dropped. Of course, many people would not be qualified for refinancing today because real estate values have declined and they don’t have enough equity in their homes to get loans on the amount they owe.

There is also little activity in home sales as buyers aren’t motivated.

“It’s not like 2005 when everyone ran saying ‘if we don’t buy now, we’re going to be priced out because real estate always goes up,’” McMaken said. “We all thought that way.”

Now the reverse is true, and buyers aren’t rushing to get into the market.

The mountain communities are exceptions to the low deed release rates reported in the rest of the state, McMaken said. Those areas are still suffering, but there is more activity there than there is along the Front Range and in counties where home prices are the lowest like Weld and Pueblo counties.